Programme improves farmers’ productivity & welfare, supporting sustainable agriculture production in Indonesia
Jakarta, 23 May 2016 – Over the next four years one million farmers from different agriculture commodities across Indonesia will be targetted to join Innovative Value Chain Schemes aimed at increasing farmers’ productivity and income.
An integrated public-private partnership involving the Indonesian Government, the Indonesian Chambers of Commerce (KADIN) and the Financial Services Authoity (OJK) under the umbrella of Partnership for Indonesia’s Sustainable Agriculture (PISAgro), the initiative has already reached more than 445,000 farmers in 2016, covering a combined total area of more than 350,000 hectares. In 2015, this programme reached 83,000 farmers and a total area of 67,000 hectares.
Rosan Roeslani, Chairman of KADIN, said: “Smallholder farmers play a vital role in the Indonesian economy but many are facing real challenges in terms of the productivity and quality of their crops and commodities. The Innovative Value Chain Schemes is ‘Kredit Usaha Rakyat (KUR) Plus’, an innovative credit scheme for the farmers with additional benefits, such as compensation during replanting, infrastructure support, provision of high yield seeds and fertiliser.”
The programme also offers infrastructure support, provision of high quality seeds and fertiliser, estate management and training on good agricultural practices, access to banks and financial literacy education, farmers empowerment through their cooperatives and sustainability certification.
Sucessful pilot projects to support financial inclusion for the farmers have already been implemented in corn, palm oil and coffee, with cocoa and other commodities such as rice, soybean, potatoes, dairy farm, horticulture, rubber following. The pilot projects have improved farmer’s productivity and income by an average of 25%, depending on the commodities and farmers participating.
Franky O. Widjaja, KADIN Vice Chairman for Agribisnis, Food & Forestry and Co-Chairman of PISAgro, says: “More farmers need better access to innovative and affordable financing in order to improve their productivity and welfare. The financial community has an important role to play and we hope to see greater collaboration with banks, insurance and other institutions to help farmers address gaps in agri-finance services. When farmers prosper, Indonesia prospers.”
PISAgro and KADIN cooperate with Ikatan Sarjana Ekonomi Indonesia (the Indonesian Economist Association/ISEI) to assist with formulating breakthrough action plans through MOUs and inter-agency synergies to help farmers gain more value from the Innovative Value Chain Schemes.
Muliaman D.Hadad, Chairman of ISEI says: “Innovative Value Chain Schemes benefit farmers because they address farmer needs from finance, through production methods to accessing markets (end to end). The challenges that farmers face today include access to financing, quality of seeds and fertiliser, and harvesters who are willing to buy at a fair price.”
“In addition to getting affordable loans, farmers have acess to guaranteed seeds, fertiliser and training on good agricultural practices, compensation during replanting and guaranteed purchase of their harvests by the companies. The schemes address the broader farmer challenges of both seasonal and perennial crops,” he adds.
PISAgro or Partnership for Indonesia’s Sustainable Agriculture is a public-private partnership established to support the Indonesian Government to maintain the country’s food security by improving farmers productivity and welfare. PISAgro has 12 working groups with the Indonesian government, a number of companies, NGOs and international organisations as its members. The organisation’s New Vision for Agriculture (www.weforum.org/projects/new-vision-agriculture) integrates food and nutritional security, economic opportunity and environmental sustainability, with a goal of improving each by 20% per decade until 2050.
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For future information, please contact:
R.A Yudha Abubakar
Communication Manager, PISAgro
Tel: (62) 21 5033 3888 ext. 8740
Mobile: (61) 856 738 9411